The metabolic defect in patients with Types C and D Niemann-Pick disease has been shown to be due to abnormal intracellular cholesterol homeostasis. The molecular lesion in these disorders results in: (1) failure to down-regulate LDL receptors on cell membranes; (2) lack of down-regulation of HMGCoA reductase, a key enzyme in cholesterol biosynthesis; and (3) inability to up-regulate acyl cholesterol acyl CoA transferase. the enzyme that catalyzes the esterification of intracellular cholesterol. Tests have been developed and introduced into medical practice for the diagnosis of Types C and D Niemann-Pick disease and the identification of heterozygotes, and the prenatal diagnosis of these conditions. Current emphasis is on the development of effective therapy for patients with this novel metabolic disorder and the elucidation of its molecular basis.